Category: Finance

Small Businesses That Generate the Biggest Profits

Some industries are more Soloprenuer-friendly than others. Accountants and bookkeepers, real estate sellers, attorneys, landlords and certain healthcare practitioners are all able to operate a one-person shop quite well, perhaps with a single employee to provide administrative help.

Educational requirements and professional credentials pose a formidable barrier to entry for several of these high-yield business opportunities, most notably dentistry, chiropractic, law and accounting (CPA or certified financial analyst). In contrast, real estate sales requires only a license to do business, the right relationships and no real selling skills if you are in a hot market. If someone with a broker’s license brings you into the business, you can work under the umbrella of that person’s credentials.

I look askance at the stated prospects for attorneys, however. There have been many mergers between big law firms and as a result, many lay-offs. From a former employee of a very prestigious law firm who was let go six or seven years ago and eventually started her own boutique firm, those who venture out on their own can encounter stiff competition in certain legal specialties. Welcome to the new normal. Below are the small businesses that on average have the healthiest profit margins.

Business Net profit margin

Accounting / Bookkeeping 18.4%a

Landlords 17.9 %

Legal services 17.4 %

Management of companies 16.0 %

Real estate sales 14.9 %

Dentist’s office 14.8 %

Health practitioners (chiropractors, etc) 13.0 %

Medical & diagnostic laboratories 12.1 %

Automotive equipment rental or leasing 12.0 %

Graphic and industrial design 11.4%

Warehousing & storage 11.0 %

Management, scientific, or technical consulting 10.3 %

Financial Advisor Help A Business

Businesses owners are who are found not to be consulting with a professional financial advisor also didn’t have any plan on how to address future change that was inevitable which affects the business with large impact. These professionals have the required and necessary experience, expertise, and qualification to allow owners to make the most of their capital investments. They can evaluate the viability of a business model to enable them to draw outlines of strategies while creating timelines for the path towards profitability.

Here are some fundamental benefits that can easily express how a financial advisor can help a business.

  • Competent Help

To make life easier, a financial advisor understands which questions ask to find out the correct answers for business owners. Effectively enhancing the efficiency while adding to profitability, these experts focus on the action to provide results. The modern entrepreneur has many roles to play in a business and stretch themselves thin at times. While tending to IT needs and then rushing to packaging and delivery section to follow up on orders, many important financial matters may become burdensome. Cash flow monitoring and aspects of monetary essence can be easily mishandled leading to severe obscurities. Mismanaging money is the most commonly recurring problem for many businesses. Hiring a financial advisor has to be one of the best things that can happen to a business.

  • Cost Savings

While performing specific functions for a business, the owner will not be able to control the path the business is on. small business owners save time and money by hiring a professional that carry out complex tasks which ultimately lead the owner to make decisions that are based on facts, figures, and numbers and also from a position of strength. Accounting processes, for example, to monitor expenses can be established by a financial advisor that in turn leads to ledger-bliss. A capable advisor can help business owners to avoid mistakes that may cost them dearly and save them a lot of angst.

  • Planning Ahead

In dealing with matters of the finances, a cool perspective is greatly needed. Being overwhelmed or confused can lead to inadequate decision-making processes that won’t be able to hold in the future. Professional advisors can provide clarity, vision, and direction that is the foundation of stability and growth. By giving facts and assessing the schedule, they can navigate through financial issues. Planning and projecting outcomes of the future in a business can be tricky and many business owners seldom consider market changes, technology, or other aspects that can prove to be crucial in a business.

Ways To Raise Money For A Business

Raising Money

When you venture into the market seeking ways to raise money, you get hundreds of people advising you on the different ways to raise and manage money. However, none of them may ever sign a check for you. There are rough and smooth times in the market. We have listed some simple ways of raising capital.

Seed Capital

The amount of money you bring in when venturing into any kind of business initiative is the seed capital. You can also take the advantage of angel investors today. There are people who are ready to fund start-up industries all over the world. However, you need to have a strong project to attract angel investors. You have to make sure that you keep up the trust reposed on you by these angel investors.

Bank Loans

Availing bank loans is the second most popular way of raising money other than bringing in one’s share of capital. In this liberalized age, you can find many banks formulating loan options for new start-up entrepreneurs to acquire machinery, working capital, etc. Some banks have plans where you do not have to provide any kind of collateral security. Searching for such options should be your priority.

Raise Funds

You can raise funds from people you know such as friends and relatives. You can also raise funds from the market. Having a viable project on hand is a pre-requisite for raising funds from the market. People will have to believe in your ability to generate profits. No one likes to invest in a loss making company. The first steps are difficult. However, if you overcome the initial hardships and prove your ability to succeed, you will never face any shortage of funds from the market.

Types of Financial Fraud In Business

Asset misappropriation

Asset misappropriation is the type of fraud that involves a member of staff who uses their position to take from their employers. This fraud is often committed by those trusted to manage the interests and assets of a company, which can include board members, employees or directors.

This type of fraud activity can include theft of company formulas, patents, or sensitive data, theft of credit notes or vouchers, inventory theft, theft of money or check forgery.

Any company that suffers from asset misappropriation will experience cash flow issues in some form. Plus, it can also have a negative impact on staff morale and the company’s reputation. It is believed that over 90% of business fraud is related to asset misappropriation which makes it by far the most common issue. On average, the lost from this type of fraud is in the region of $150,000 per case.

Bribery and corruption

Bribery and corruption is the next most common issue related to fraud in a business environment. Even though this type of fraud is less common than asset misappropriation, the average cost of a bribery scheme is significantly higher, and likely to exceed over half a million dollars per case.

The type of schemes involved in this area are quite broad and can include substitution of inferior goods, manipulation of contracts, bribes to influence decision-making, shell company schemes and kickbacks.

Financial statement fraud

Financial statement fraud takes place less frequently, but is almost certainly to be the most experience per case. On average, this type of fraud can lead to a company losing up to $2 million per case. This fraud involves an entity or individual falsifying earnings or income statements in an attempt to make a financial gain for them.